It seems to boil down to the question of how much you believe in the Recs market working.
The way I understand those Recs is, they pay extra to have green energy produced, but it’s not in the location where they are actually using energy. So their actual energy use is much more grey than what they pay for, but they essentially say as long as the correct pricing signal reaches the location independant energy market this is good for green energy buildup.
Now the idea behind that must be that it’s more sensible to support green energy production in places where projects are being built, where they perhaps can be most efficiently built, rather than trying to bribe the local suppliers into building green energy locally, where perhaps the location isn’t even well suited. It’s kind of understandable from that perspective.
But I can see how there would be lots of corrupting influences here. The companies local to the green electricity producers can factually claim that the local power is greenly produced without paying for the Recs, and the remote companies can pay the Recs and claim they are supporting green energy. In the end you have a sort of double counting of the green energy, swallowing up some of the market demand for an actual buildup of more green energy capacity. Or even more nefarious, maybe a company could start issuing more Recs than green energy production actually justifies.
The system also masks out the issue of actually transmitting and storing the green energy from where and when it’s produced to where and when it’s needed. Even if you have perfect Recs accounting in the system, nothing guarantees that the pricing signals align time wise. Green energy prices should be higher during the night or winter, but that’s not reflected in time independant Recs.
And finally the existance of the Recs system absolves the data center builder from choosing a location where green energy can be produced or transmitted to. If this ends up placing a datacenter close to a coal power station, and then they buy Recs from a solar park in a desart far away. In the end this makes it harder for the local community to overcome the need for the coal power station. It might have been possible to build enough local green energy and storage without the datacenter next door, but once it’s there soaking up lots of local capacity it’s going to be much harder to replace the local grey producer.
It’s pretty well documented that the transferrable renewable energy credits don’t result in the construction of additional renewables. That lack of additionality means that they’re not effective at causing decarbonization.
It seems to boil down to the question of how much you believe in the Recs market working.
The way I understand those Recs is, they pay extra to have green energy produced, but it’s not in the location where they are actually using energy. So their actual energy use is much more grey than what they pay for, but they essentially say as long as the correct pricing signal reaches the location independant energy market this is good for green energy buildup.
Now the idea behind that must be that it’s more sensible to support green energy production in places where projects are being built, where they perhaps can be most efficiently built, rather than trying to bribe the local suppliers into building green energy locally, where perhaps the location isn’t even well suited. It’s kind of understandable from that perspective.
But I can see how there would be lots of corrupting influences here. The companies local to the green electricity producers can factually claim that the local power is greenly produced without paying for the Recs, and the remote companies can pay the Recs and claim they are supporting green energy. In the end you have a sort of double counting of the green energy, swallowing up some of the market demand for an actual buildup of more green energy capacity. Or even more nefarious, maybe a company could start issuing more Recs than green energy production actually justifies.
The system also masks out the issue of actually transmitting and storing the green energy from where and when it’s produced to where and when it’s needed. Even if you have perfect Recs accounting in the system, nothing guarantees that the pricing signals align time wise. Green energy prices should be higher during the night or winter, but that’s not reflected in time independant Recs.
And finally the existance of the Recs system absolves the data center builder from choosing a location where green energy can be produced or transmitted to. If this ends up placing a datacenter close to a coal power station, and then they buy Recs from a solar park in a desart far away. In the end this makes it harder for the local community to overcome the need for the coal power station. It might have been possible to build enough local green energy and storage without the datacenter next door, but once it’s there soaking up lots of local capacity it’s going to be much harder to replace the local grey producer.
It’s pretty well documented that the transferrable renewable energy credits don’t result in the construction of additional renewables. That lack of additionality means that they’re not effective at causing decarbonization.